Blog Articles
On July 1 of this year Charlie Christ signed into law the Distressed Condominium Relief Act which is designed to give assurances to bulk condominium buyers that they won’t be liable for flaws in a building they did not develop. This is great news for real estate investors who can now acquire more than 7 condominium units and not be held liable as a “successor developer”.
This new law will be beneficial for a number of reasons:
- Real estate investors may be able to increase pricing as a result of the lower liability risk of buying more than 7 condominium units.
- Fannie Mae requires that no more than 15% of the units in a building are in default and not paying assessments. More bulk sales should bring buildings closer to qualifying for Fannie Mae financing.
- If there is an absentee owner collecting rent and not paying assessments, the new law allows the tenant to pay rent directly to the condominium association which promotes the overall health of a building.